Now, these problems have been fairly obvious for at least a decade. Why are they only becoming acute now? Well, international economists are fond of citing Dornbusch’s Law: “The crisis takes a much longer time coming than you think, and then it happens much faster than you would have thought.” What happened in China’s case was that the government was able to mask the problem of inadequate consumer spending for a number of years by promoting a gigantic real estate bubble. In fact, China’s real estate sector became insanely large by international standards.
I don’t understand this take. Comments like this suggest collapse happens overnight. Which means if china didn’t catastrophically collapse in the last 24 hours it means it isn’t happening at all or never.
The reality is collapse happens very slowly. There is no question that the health of the economy both in china and the rest of the world is steadily getting worse year by year.
Collapse isn’t going to happen. It’s already happening. It’s just a steady and slow march to the bottom.
An attempt to reconcile both views by comparing it to a structural collapse of, let’s say, a bridge.
In the end, it collapses. Before that, the cracks begin to show. Before that, invisible micro-cracks form. Before that, pressure exceeds limits.
Now, at which point in this story does “collapse happen”? Some use this to refer to the actual collapse, after the cracks began to show.
But since collapse is inevitable after too many micro-cracks have formed (or maybe even earlier, since those are already symptoms of an underlying cause), some refer to this long, unspectacular build-up phase as “collapse happens”.
I’m neither an economist nor a civil engineer. Bridges are complex, economies even more so. I still think these two views explain how the same term can refer to different things, or different phases of the same thing.
Collapse doesn’t happen drastically. It’s a slow boil. You’re just not paying attention. It’s slow enough that if you don’t pay attention to current events and the state of the economy it’s easy to miss and assume everything is OK.
Things are worse now than they were in 2008. It’s only getting worse. It’s going to become much much worse before it ever gets better.
Yeah, it’s a believe it when you see it thing at this point. They might stagnate out economically or have internal supply issues, but there’s a world of difference between that and actual regime instability.
Case in point: Zimbabwe is still run by largely the same group of guys that ordered the 100-trillion dollar bills made.
Your annual reminder for the past ten years that “China is about to collapse any day now”
Per the article:
This is a well known feature of all complex systems. How they change is “not at all, and then suddenly”.
Yet people always insist they must change slowly and steadily.
I don’t understand this take. Comments like this suggest collapse happens overnight. Which means if china didn’t catastrophically collapse in the last 24 hours it means it isn’t happening at all or never.
The reality is collapse happens very slowly. There is no question that the health of the economy both in china and the rest of the world is steadily getting worse year by year.
Collapse isn’t going to happen. It’s already happening. It’s just a steady and slow march to the bottom.
There was another comment claiming that collapse happens drastically once it starts. So what is it then
Both
An attempt to reconcile both views by comparing it to a structural collapse of, let’s say, a bridge.
In the end, it collapses. Before that, the cracks begin to show. Before that, invisible micro-cracks form. Before that, pressure exceeds limits.
Now, at which point in this story does “collapse happen”? Some use this to refer to the actual collapse, after the cracks began to show.
But since collapse is inevitable after too many micro-cracks have formed (or maybe even earlier, since those are already symptoms of an underlying cause), some refer to this long, unspectacular build-up phase as “collapse happens”.
I’m neither an economist nor a civil engineer. Bridges are complex, economies even more so. I still think these two views explain how the same term can refer to different things, or different phases of the same thing.
Collapse doesn’t happen drastically. It’s a slow boil. You’re just not paying attention. It’s slow enough that if you don’t pay attention to current events and the state of the economy it’s easy to miss and assume everything is OK.
Things are worse now than they were in 2008. It’s only getting worse. It’s going to become much much worse before it ever gets better.
Closely followed by, “Trump is in trouble this time” articles that we’ve been getting for the last 6 years.
Yeah, it’s a believe it when you see it thing at this point. They might stagnate out economically or have internal supply issues, but there’s a world of difference between that and actual regime instability.
Case in point: Zimbabwe is still run by largely the same group of guys that ordered the 100-trillion dollar bills made.
Yep you can definitely build lots of skyscrapers, then just demolish them without any financial repercussion.